The Software IP Report

Conclusory Legal Statements are not Factual Allegations to Survive Section 101 Eligibility: Dropbox Inc. v. Synchronoss Techs, Inc.

Conclusory legal statements that attempt to invoke a factual allegation do not sufficiently allege an inventive concept to satisfy patent eligibility under 35 U.S.C. § 101. Dropbox Inc., Orcinus Holdings, LLC v. Synchronoss Techs. Inc, 2019-1765, 2019-1767, 2019-1823 (Fed. Cir. June 19, 2020) (nonprecedential).

Plaintiff Dropbox asserted infringement of U.S. Patent Nos. 6,178,505, 6,058,399, and 7,567,541 against Defendant Synchronoss. The patents are directed to data security and data uploading to websites and networks. The district court granted Defendant’s motion to dismiss under Rule 12(b)(6), holding that all three patents as ineligible under 35 U.S.C. § 101. In particular, the district court held that Plaintiff failed to allege an inventive concept to satisfy the second part of the two-part Alice test.

The details of the specific patents would warrant their own posts, so we will focus on the Court’s discussion of Plaintiff’s factual allegations of an inventive concept. Some courts have held that sufficient factual allegations of an inventive concept can present an unresolved question of fact to survive Rule 12(b)(6) and that this should be the norm to better develop the factual record. Other courts, like the district court here, are perfectly happy to hold claims ineligible under Section 101 at the pleadings stage.

The Court agreed with the district court that Plaintiff provided “no specific factual allegations or references to the specification—which might disclose that the invention is an improvement over the prior art….” Plaintiff’s conclusory statement that “nothing in the specification describes [the claimed] concepts as well-understood, routine, or conventional,” attempting to rely on Berkheimer, did not sway the Court that the asserted patents included an inventive concept. Indeed, the Court noted that while courts “must take all the factual allegations in the complaint as true,” they “are not bound to accept as true a legal conclusion couched as a factual allegation.” The Court pointed to their prior decision in Cellspin as an example laying out how to identify specific parts of the claims and specification to support factual allegations of an inventive concept. Without such direction to the specific claim language and specification support, the Court finds an allegation of an inventive concept as a conclusory legal statement. Finding only conclusory pleadings, the Court affirmed the district court’s dismissal.